"Real time" communications networks are used for various types of financial transactions, and may involve network transit times of up to a few seconds after a particular message is transmitted by one party until it is received by the other party. In such networks, a pending transaction may be interrupted not only by the counterparty, but also as a result of a communications failure in the communications link connecting the two parties. Particularly in financial transactions involving large sums of money, a separate transaction record is maintained by each party. In that case, an interrupted transaction can result in a discrepancy between the relevant records maintained by the two parties, which usually had to be resolved by a careful manual review of each party's transaction logs.
Two-stage commitment protocols have been implemented in certain communication networks utilized by the banking industry for electronic fund transfers. Such a two-stage commitment regards a transaction as "doubtful" until each party's computer has confirmed that the transaction has been logged as "committed" by the counterparty's computer.
U.S. Pat. No. 4,525,779 (assigned to Reuters Ltd. and entitled "Conversational Video System") discloses a text oriented communication system for effecting foreign currency exchanges in which either party may transmit an electronic "DEAL" signal to his counterparty which is automatically answered by a "ACKNOWLEDGED" signal. If the transmitting party's transaction log shows a "DEAL" signal immediately followed by an ACKNOWLEDGED signal, this provides verification that any outstanding offer had not been withdrawn, and the communication link with his counterparty had not been interrupted before any text transmitted with or prior to the "DEAL" signal had been received by the counterparty. However, such a system requires the trader who initiated the transmission of the "DEAL" signal to monitor his on-screen transaction log and to request a manual review of the counterparty's transaction logs in the event that no "ACKNOWLEDGED" signal is received within a reasonable time (for example, as a result of a temporary failure in the communications link connecting the trader and his counterparty). Particularly in negotiations involving foreign currencies and other marketable securities that are sometimes subject to relatively large price movements over a relatively short period of time, uncertainty as to whether an offer had been accepted could subject the trader to considerable financial exposure.
There remains a need for a reliable and impartial automated exchange system which can automatically determine whether any offers were accepted (orders placed) during the small (typically only a few seconds) window of uncertainty between the time an outstanding offer is withdrawn (quote interrupted) and the time the person placing the order has been notified of the interruption, and, if there were any such orders, can automatically advise the party placing the order whether his counterparty was committed to accept the order.